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How medical debt and other collection items are tallied in a credit score is changing, potentially increasing the credit scores of millions of people.

Called the FICO 9, the new credit score changes how medical collections are treated from non-medical changes, such as credit cards. A medical debt will now damage a credit score less than paying a credit card bill on time, for example.

FICO 9 came out in 2014, but the improved credit scores could just now be coming to fruition for many consumers because it can take a few years for banks and other lenders to implement the new system.

The new FICO 9 score should give responsible borrowers better access to credit and lower rates on existing credit once the changes are accepted by the industry.

Part of the thinking behind the changes is that for many people facing medical debt collections, it isn’t something they have a lot of control over. People get sick or are in an accident and can’t control how high their medical bills are, and may not even know that their medical debt is in collections.

More than 64 million Americans have some kind of medical collection record on their credit reports, according to Experian, a credit bureau. Almost all medical debts are reported to credit bureaus by collection agencies.

The FICO score is the most widely used credit score in the country, and is used by companies selling mortgages, credit cards, personal loans and more.

Another change with FICO 9 is that older collection items will have less impact on a credit score. Other types of debt that are sold to a collection agency—such as an unpaid utility bill or phone bill, school loan or rent—can still be reported to a credit bureau, but older collections will have less impact on a credit score. If the collection item is paid back, the score will improve.

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If you’ve got a problem with credit card debt, there might be a simple solution that’s already sitting in your wallet or purse — a $20 bill.

Having cash in your pocket may seem counterintuitive. If you’ve heard the phrase “burning a hole in my pocket,” then you know how enticing it can be to spend money you’re carrying around.

But having cash on hand can cause you to spend less money than you would with a credit card — at least for small purchases — researchers have found.

A study by the Urban Institute found that using cash when a purchase is under $20 left the consumer with $104 less in revolving debt, on average. That dropped their credit card balances 2 percent below their baseline average.

For young people, the $20 cash rule led to more savings. People under 40 who were reminded “don’t swipe the small stuff” and to use cash on purchases for less than $20 had $173 less in revolving debt.

Credit keeps charging
The group also sent reminders to credit union members that “credit keeps charging” and that using a credit card adds about 20 percent to the total cost of something.

People who received that reminder didn’t significantly change the amount of their credit card debt, the survey found, but younger people did charge less. People under 40 who received the reminder about the cost going up by 20 percent with a credit card had $160 less in credit card debt.

A swipe is easy
Swiping a credit card can seem a lot easier and cheaper than using cash because you’re not parting with anything tangible. Seeing a $20 bill leave your wallet feels more like spending money than using a plastic card to buy something. After all, a $6 drink doesn’t look too bad when compared to a $5,000 spending limit on your credit card.

Having cash on hand helps you refrain from making small impulse purchases, which quickly add up. Check your credit card statement – seeing is believing.

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No one wants to be reminded by their bank that using a credit card too much is a bad idea. It’s a rule of thumb that everyone knows, but often avoids because a credit card is a major convenience. After all, who wants to always carry cash for everyday purchases?

However, it turns out that “revolvers” — people who carry a balance on their credit card each month with revolving credit — can save some money by being reminded every once in a while by their bank about the downsides of using credit cards.

Researchers at the Urban Institute found that email reminders from your bank or a banner ad on its website can become big enough annoyances to get credit card users to cut spending by 2 percent.

One message reminded credit card holders to use cash for a purchase of less than $20. A second message highlighted the fact that credit cards add 20 percent to the cost of something with revolving credit.

The first message led to an average savings of $104, and up to $173 for revolvers under age 40. The second message had less of an impact, saving people under 40 an average of $160.

There are other small ways consumers can remind themselves to use their credit card less. Budgeting apps or reminders set up on your phone can help you automate savings, for example, by automatically moving money into a savings or retirement account.

Your bank‘s app or website may also allow you to set text or email alerts when your account balance is low. Your credit card may be able to do the same thing, sending you an email when you’ve spent over a certain amount on a purchase, or letting you know when you’re near your credit limit.

The America Saves program sends periodic text messages to participants with savings tips and words of encouragement. Apps such as Hiatus and Trim help consumers stop automatic renewals on their credit cards that they may have forgotten about.

If you carry a revolving balance on your credit card, you’re not alone.

Data from TransUnion, a consumer credit reporting agency, shows that about 133 million people have at least one credit card with a balance. The average credit card debt rose to $5,247 in the second quarter of this year, up from $5,197 in the first quarter.

To start lowering your credit card debt, make more than the minimum payment each month. Until you start using only cash for purchases of $20 or less, that’s one of the best ways to tackle credit card debt.

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